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I wonder what these figure would be in countries like Russia or China. I would also say American's are simply bad at planning for the future, and highlight the

I wonder what these figure would be in countries like Russia or China. I would also say American's are simply bad at planning for the future, and highlight the fact that 75% of Americans die intestate (or without a Will). But, I think the truth is that is only part of the explanation. While a Will would benefit and be applicable to everyone, not just people with assets, retirement is purely for people who have some type of financial surplus and lets get real. Most Americans are debt financed, from housing, to transportation, to schooling, to even putting food on the table. It would be very interesting to see how many of those 2/3's who are saving for retirement are actually debt financing their retirement funds (which admittedly makes sense with employer matching), meaning they are living off credit and going (further) into debt while simultaneously saving for retirement. I would venture to guess the numbers are much worse than this article even concludes.

TheAdamAndChe 9y ago
It's not so much that Americans are bad at planning, it's just that they're not taught to do it. It's not taught in schools, and because their parents didn't need to plan so much when the economy was much better, it wasn't a skill that has been passed down. I bet a much of those "millennial trends" killing off overpriced businesses like Applebees and whatnot is due to the internet spreading financial literacy to the younger generations. That and they're too poor to eat there, but I bet the internet is having an effect too.
- obstacle1 9y ago
  Not being taught a thing and being bad the thing are not mutually exclusive.
- icelancer 9y ago
  >It's not so much that Americans are bad at planning, it's just that they're not taught to do it. It's not taught in schools, and because their parents didn't need to plan so much when the economy was much better, it wasn't a skill that has been passed down. This is simply not that true. It was taught in my public school and taught to most of my friends that went to public schools near me. Also taught in college. It didn't help. The power of compounding interest is taught to almost everyone and even fake quotes from Einstein used to hammer it home. My generation (mid-30s) faced a post-graduate nightmare of a job market after 9/11 and then the 2007 credit decoupling in combination with a massive run-up in real estate values in the largest cities in America. No one had money to save. I have managed to save starting in my 30s but I have quite a few friends who work paycheck to paycheck. The education was there. The ability is lacking.
thaumasiotes 9y ago
> While a [w]ill would benefit and be applicable to everyone, not just people with assets What is the benefit of a will for someone who dies with no assets?
- will_brown 9y ago
  What do you want done with your body? Maybe more importantly if you have children you may wish appoint a guardian in the instance they are minors. Say you are incapacitated and unable to make medical decisions, you may wish to provide instructions for specific circumstances and even appoint someone to abide by your healthcare decisions or exercise their judgment where your directive is silent. (usually called a Health Care Directive, while not a Will it is part of a basic estate plan you would receive when creating the Will).
gedy 9y ago
> going (further) into debt while simultaneously saving for retirement Maybe not your exact point, but people looked at me like I was from Mars when they found out I skipped 401k in order to save up for large down payment on a house, and to finance less. The interest saved using a 15 year mortgage vs a 30 year is (or was) huge.
- radiorental 9y ago
  While every case is different the 'interest saved' + federal tax saving on a 15v30yr mortgage do not compare favourably to compounding that money towards retirement. In general terms, you're leaving ~5% on the table during the 15yr term. That 50-100k you saved could have turned into ~500k upon retirement
lsiebert 9y ago
I'm not sure what fundamental characteristic of Americans would make them significantly different then the overall population of the earth in terms of planning. Systemic economic reasons seem more likely. I'd note that you have to have wealth to pass it on, and that economic mobility in America has been in decline since the 80s, https://www.theatlantic.com/business/archive/2016/07/social-mobility-america/491240/ https://www.theatlantic.com/business/archive/2016/07/social-...
- will_brown 9y ago
  We've all been raised on television to believe that one day we'd all be millionaires, and movie gods, and rock stars. Sure you need wealth to pass it on, but notice how you limited you statement to wealth, that is why American's are IMO different than the overall population of the Earth in terms of planning. I think other cultures are more in touch with reality and not so consumed with wealth. The reality is even if you die with no wealth to pass on, you have a body (what is to be done with it?); you may have minor children (who do you want to be their guardian?); and you may not die but simply be incapacitated (who will make your health care decisions and what do you want those decisions to be?).
- jk2323 9y ago
  Americans, both people and companies, are much more short term focused then, lets say Germans or Nordic countries in Europe. And again, no comparison with let's say China. A government in China may not only make a 5 year plan, but a 50, 100, 150 year plan. This may look mind puzzling to you and you can doubt it's effectiveness. But nevertheless they do. It is said that Deng said, when asked what he thinks about the French revolution (1789!): "It is to early to tell"
- blubb-fish 9y ago
  The average American has a weaker social network than people from other countries. Americans are also highly focused on consumption and status symbols - more than people from Russia or China.
izacus 9y ago
> I wonder what these figure would be in countries like Russia or China. Doesn't at least Russia have a mandatory pension contribution like rest of Europe?
- nmbr213 9y ago
  Yes, 13% of one's income, but since the start of economic crisis in 2014 all pension accumulation has been frozen, i.e. for the last 3 years all contributions went to sustain the current system without going into savings.
- kmike84 9y ago
  Yes, it has. Isn't Social Security a similar thing in US? For comparison: average pension in Russia is ~$220/month ("average" means there are people who get less than that). Wikipedia quotes average SS payments as $1,230/month. I don't have numbers, but my feeling is that almost no one has retirement savings in Russia; it is uncommon to save for retirement. It looks much worse in Russia overall - majority of population hopes to work until retirement age, then work more, then live off those tiny Social Security-like payments. On the upside, a lot of people is debt-free (though this is changing), and some level of medical services is also free.
  - oh_sigh 9y ago
    Not to nitpick, but no, SS is essentially an immediate redistribution of funds from workers to some non workers. If SS was cancelled tomorrow, there would be no funds available to redistrubite to those who paid in.
    - izacus 9y ago
      This is unfortuantely how most of European pension systems work - you don't accumulate money in the savings account, but they go immediately to the current receivers of pensions.
  - will_brown 9y ago
    In my early to mid 20's I received a letter from the Social Security Administration and the estimate was I would be receiving $0.42 for every $1 I put in. It was kind of odd, I have never received such a letter before or since, but it wasn't very encouraging to think I am subsidizing the generation that put the County into this financial mess and I will never get that money back. Debt for individual households in the US is still relatively new, in 1950 it was nearly $0 and its now it is well over $10Trillion (closer to $13). Households in the US with debt have an average of $135,000. And counter-intuitively as incomes increase households are not less likely to be in debt, statistically they will have the most debt.
tbronchain 9y ago
Whenever you legally work in China, after a certain amount of time (don't remember the details) and regardless of your citizenship, you will receive a fixed amount of money when you retire, according to the amount of time you worked and your salary. Interesting thing is, foreigners can apply to get their money anytime they want when they stop working, not sure if that applies for Chinese citizens. Their is also a "housing" fund supposed to help for paying your mortgage or rent, paid by the employer. All this is managed by the government but you can improve it using private retirement plans and insurances, however employers cannot (shouldn't) be allowed to not sponsor the government one. It is in some ways similar to some Western European countries, like France, where you are supposed to get money from the government once you have worked a certain amount of time and you decide to retire. I guess it differs a lot in the execution though.
- agumonkey 9y ago
  Beware, France retirement is getting frail. Not at all like a $0 as in the US, but many elders have tiny jobs to compensate for a lower than expected sum.

TheAdamAndChe 9y ago

It's not so much that Americans are bad at planning, it's just that they're not taught to do it. It's not taught in schools, and because their parents didn't need to plan so much when the economy was much better, it wasn't a skill that has been passed down. I bet a much of those "millennial trends" killing off overpriced businesses like Applebees and whatnot is due to the internet spreading financial literacy to the younger generations. That and they're too poor to eat there, but I bet the internet is having an effect too.

obstacle1 9y ago
Not being taught a thing and being bad the thing are not mutually exclusive.
icelancer 9y ago
>It's not so much that Americans are bad at planning, it's just that they're not taught to do it. It's not taught in schools, and because their parents didn't need to plan so much when the economy was much better, it wasn't a skill that has been passed down. This is simply not that true. It was taught in my public school and taught to most of my friends that went to public schools near me. Also taught in college. It didn't help. The power of compounding interest is taught to almost everyone and even fake quotes from Einstein used to hammer it home. My generation (mid-30s) faced a post-graduate nightmare of a job market after 9/11 and then the 2007 credit decoupling in combination with a massive run-up in real estate values in the largest cities in America. No one had money to save. I have managed to save starting in my 30s but I have quite a few friends who work paycheck to paycheck. The education was there. The ability is lacking.

thaumasiotes 9y ago

> While a [w]ill would benefit and be applicable to everyone, not just people with assets What is the benefit of a will for someone who dies with no assets?

will_brown 9y ago
What do you want done with your body? Maybe more importantly if you have children you may wish appoint a guardian in the instance they are minors. Say you are incapacitated and unable to make medical decisions, you may wish to provide instructions for specific circumstances and even appoint someone to abide by your healthcare decisions or exercise their judgment where your directive is silent. (usually called a Health Care Directive, while not a Will it is part of a basic estate plan you would receive when creating the Will).

gedy 9y ago

> going (further) into debt while simultaneously saving for retirement Maybe not your exact point, but people looked at me like I was from Mars when they found out I skipped 401k in order to save up for large down payment on a house, and to finance less. The interest saved using a 15 year mortgage vs a 30 year is (or was) huge.

radiorental 9y ago
While every case is different the 'interest saved' + federal tax saving on a 15v30yr mortgage do not compare favourably to compounding that money towards retirement. In general terms, you're leaving ~5% on the table during the 15yr term. That 50-100k you saved could have turned into ~500k upon retirement

lsiebert 9y ago

I'm not sure what fundamental characteristic of Americans would make them significantly different then the overall population of the earth in terms of planning. Systemic economic reasons seem more likely. I'd note that you have to have wealth to pass it on, and that economic mobility in America has been in decline since the 80s, https://www.theatlantic.com/business/archive/2016/07/social-mobility-america/491240/ https://www.theatlantic.com/business/archive/2016/07/social-...

will_brown 9y ago
We've all been raised on television to believe that one day we'd all be millionaires, and movie gods, and rock stars. Sure you need wealth to pass it on, but notice how you limited you statement to wealth, that is why American's are IMO different than the overall population of the Earth in terms of planning. I think other cultures are more in touch with reality and not so consumed with wealth. The reality is even if you die with no wealth to pass on, you have a body (what is to be done with it?); you may have minor children (who do you want to be their guardian?); and you may not die but simply be incapacitated (who will make your health care decisions and what do you want those decisions to be?).
jk2323 9y ago
Americans, both people and companies, are much more short term focused then, lets say Germans or Nordic countries in Europe. And again, no comparison with let's say China. A government in China may not only make a 5 year plan, but a 50, 100, 150 year plan. This may look mind puzzling to you and you can doubt it's effectiveness. But nevertheless they do. It is said that Deng said, when asked what he thinks about the French revolution (1789!): "It is to early to tell"
blubb-fish 9y ago
The average American has a weaker social network than people from other countries. Americans are also highly focused on consumption and status symbols - more than people from Russia or China.

izacus 9y ago

> I wonder what these figure would be in countries like Russia or China. Doesn't at least Russia have a mandatory pension contribution like rest of Europe?

nmbr213 9y ago
Yes, 13% of one's income, but since the start of economic crisis in 2014 all pension accumulation has been frozen, i.e. for the last 3 years all contributions went to sustain the current system without going into savings.
kmike84 9y ago
Yes, it has. Isn't Social Security a similar thing in US? For comparison: average pension in Russia is ~$220/month ("average" means there are people who get less than that). Wikipedia quotes average SS payments as $1,230/month. I don't have numbers, but my feeling is that almost no one has retirement savings in Russia; it is uncommon to save for retirement. It looks much worse in Russia overall - majority of population hopes to work until retirement age, then work more, then live off those tiny Social Security-like payments. On the upside, a lot of people is debt-free (though this is changing), and some level of medical services is also free.
- oh_sigh 9y ago
  Not to nitpick, but no, SS is essentially an immediate redistribution of funds from workers to some non workers. If SS was cancelled tomorrow, there would be no funds available to redistrubite to those who paid in.
  - izacus 9y ago
    This is unfortuantely how most of European pension systems work - you don't accumulate money in the savings account, but they go immediately to the current receivers of pensions.
- will_brown 9y ago
  In my early to mid 20's I received a letter from the Social Security Administration and the estimate was I would be receiving $0.42 for every $1 I put in. It was kind of odd, I have never received such a letter before or since, but it wasn't very encouraging to think I am subsidizing the generation that put the County into this financial mess and I will never get that money back. Debt for individual households in the US is still relatively new, in 1950 it was nearly $0 and its now it is well over $10Trillion (closer to $13). Households in the US with debt have an average of $135,000. And counter-intuitively as incomes increase households are not less likely to be in debt, statistically they will have the most debt.

tbronchain 9y ago

Whenever you legally work in China, after a certain amount of time (don't remember the details) and regardless of your citizenship, you will receive a fixed amount of money when you retire, according to the amount of time you worked and your salary. Interesting thing is, foreigners can apply to get their money anytime they want when they stop working, not sure if that applies for Chinese citizens. Their is also a "housing" fund supposed to help for paying your mortgage or rent, paid by the employer. All this is managed by the government but you can improve it using private retirement plans and insurances, however employers cannot (shouldn't) be allowed to not sponsor the government one. It is in some ways similar to some Western European countries, like France, where you are supposed to get money from the government once you have worked a certain amount of time and you decide to retire. I guess it differs a lot in the execution though.

agumonkey 9y ago
Beware, France retirement is getting frail. Not at all like a $0 as in the US, but many elders have tiny jobs to compensate for a lower than expected sum.